Google Gains Ground On Microsoft Office (GOOG, MSFT)

Google Docs is often talked about as a competitor to Microsoft’s cash cow – the Office Suite – but the talks usually refer to some point in the future when everyone’s running their applications in the cloud. That day is coming.

The city of Washington D.C. recently signed a $500,000 contract so its 38,000 employees would use Google for spreadsheets, word processing and e-mail, rather than Microsoft Office, Bloomberg reports.

D.C. joins 500,000 other organizations that see Google as a feasible alternative to Microsoft. This probably has something to do with the fact that at least half of them use the free ad-supported Google suite, so they don’t have to pay anything, but Microsoft's Office feast is threatened either way.

Does this mean Office is going away tomorrow? Of course not. Does it mean that Microsoft should keep an eye on this trend? Definitely.